Not a crisis, but a negotiation is underway among the debt-ridden countries of
southern Europe. Greece and Italy illustrate Spengler's Universal Law Number
15: Stick around long enough, and you turn into a theme park. As the
descendants of the former masters of the Mediterranean fade into senescence,
hordes of Asian tourists will keep them in business. That's the Spartan model.

Sparta is the first world power to succumb to demographic suicide, and also the
first former power to live on as a theme park. Aristotle reports that Sparta
"sank under a single defeat; the want

of men was their ruin". Sparta once had 10,000 citizens, but by 371 BCE, when
Thebes broke Spartan power at the Battle of Leuctra, had shrunk to barely
1,000.

Aristotle's observation is doubly remarkable, as I report in my new book,
How Civilizations Die (and Why Islam is Dying, Too). It is the first
report in history of depopulation due to a reluctance to raise children. It is
also the first time that the decline of a great power has been blamed on
depopulation. Sparta lived on, though, as a theme park: the last remaining
Spartans continued to oil their hair, don their red robes, play their flutes
and train in a phalanx for gawking Roman visitors until the end of the 2nd
century CE. "The prestige of the 'revived' training and the tourism which it
generated helped this otherwise fairly typical provincial Greek city to
maintain a place in the world and allowed the Spartans to feel that they were
still 'special'," [1] according to two recent historians.

If Italian tourists kept Sparta afloat half a millennium after its political
model passed its best-used-by-date, Chinese tourists well might sustain Italy
for another century or two. Forty-three million tourists visited in 2009,
spending about US$1,000 each. Another 15 million came to Greece. Under the
right circumstances, Asians could double that number in a few years, helping
Italy to service its US$2.2 trillion external debt. But there's a catch: China
would have to own a good deal of the country. The Chinese do not wish to merely
stop and gawk: they want to learn, buy, and carry home the magic of Italian
manufacturing. That would unlock tens of billions of dollars of unrealized
export potential.

Unlike Germany, whose machine tools hum in every Chinese factory, Italy has
done a poor job of exporting to China. Italy's best-known manufacturing
company, the automaker Fiat, has a tenuous hold on second-rate markets, for
example, Russia and Turkey, and the downwardly mobile end of the American
market. It says something about the condition of that United States that Fiat
wants to market a revamped Cinquecento - the starter car of the Italian poor
during the 1960s - to declassed American consumers. An Istanbul taxi driver
explained to me last February why Italy will go bankrupt. "We all drive Fiat's
now," he explained. "They're lousy cars. They break down too much. But now the
South Koreans are building plants here, and in two or three years no one will
drive a Fiat."

Every Italian businessman famously keeps four sets of books; one for the tax
collector, one for the bank, one for his wife, and one for himself. The cost of
dealing with the predatory incompetence of the Italian government keeps firms
in the family. That is why there's very little that is worth buying on the
Italian stock exchange: the best firms remain closely held, many with superb
technology.

The family-owned manufacturer best known to Americans is, of course, Beretta,
which makes the US Army's standard 9mm sidearm. Italy has hundreds of superb
companies, but corruption, bureaucratic caprice and the general fecklessness of
Italian governance keep them below the radar. Closely held companies rarely
develop the global reach to realize their full potential, though.

The best thing that could happen to Italian industry would be a national
bankruptcy. If foreigners began shopping for Italian assets, Italy's best firms
would be flushed out into the open field of international trade, and their
talents would attract the capital and support they require. Italy's political
system can't be reformed. It can only be bypassed. That is what Italians have
done to survive for centuries.

A delightful primer on the Italian capacity for survival and genius for
accomplishment is Michael Ledeen's new book, Virgil's Golden Egg and other
Neapolitan Miracles (Transaction, 2011). Asian investors should study
it carefully. Italians have spent thousands of years integrating commerce and
art to create products that delight the senses.

"While big factories have not done well" in Naples, Ledeen observes,
"businesses based on high style and elegance have become world-class
enterprises. Some of the finest furniture in Italy - from inlaid marble desks
and tables to magnificent carved wood pieces - come form Naples, and men's
fashion has reached its highest level (and certainly its highest prices) in
Naples, from Marinella ties to the super-chic ateliers of Borrelli, Isaia,
Attolini, Kiton, Barba, Rubinacci, et al." Clothing this refined "feels like a
second skin", Ledeen observes.

The greatest obstacle to the preservation of Italian talent is the Italian
government. What Italy requires, in short, is an invasion on the scale of the
Gothic incursions of the 5th century CE, but with checkbooks rather than
battle-axes. Both as business people and as tourists, the Chinese will find
tastes and technologies in Italy that complement their own talents, and fill
important gaps in their own capacities. With luck, millions of Chinese tour
buses will traverse the Apennines in search of the perfect Parmesan cheese and
the optimal silk spinner or chef's stove.

China's love affair with everything Italian goes back a dozen years, when ossobucoalla
Milanese became the signature dish of Shanghai. First-rate Italian food
is easier to find in Shanghai than classic Shanghai cuisine. To transform
sentiment into investment, Italy simply needs do declare itself open for
Chinese shopping. That implies the evisceration of all the nasty political
arrangements which envelop Italy like a parasitic vine. How would this occur?
As my Asia Times colleague Francesco Sisci wrote September 14 in the Italian
daily La Stampa:

Speaking concretely, the Chinese have envisioned the
possibilities of synergies with the Italian economy for years, in almost every
sector. The [Italian energy companies] ENI and ENEL are two businesses in which
China would be interested; ENI has collaborated for years with Chinese energy
firms. Today, a participation in ENI by PetroChina, for example, could multiply
ENI's own opportunities for development, as well as bring urgently needed funds
to the Italian Treasury.

The Chinese would arrive in the nick
of time. Like the Spartans of classical antiquity, the Italians are
disappearing. With only 1.25 children per female in 2005, Italy languishes at
the bottom of Europe's fertility ranking. Before 2040, three-fifths of the
Italians will be elderly dependents, according to the United Nations. Even if
we assume that fertility will gradually recover towards the replacement level
of 2.1, the number of women of child-bearing age will have fallen by 40% by
mid-century, which means that Italy's population never will recover.

Elderly dependent ratio, selected European countriesSource: United Nations World Population Prospects

It is well for Italy's entrepreneurs to sell their skills to Asia, for some of
the best family firms will not have sufficient family members or enough skilled
workers to continue operating a generation hence. They will look like the
glass-blowers of Murano, the Venetian island famous for centuries for
hand-crafted glass. A few craftsmen of the old generation remain there, and
entertain tourists by making glass animal figures before their eyes. The aging
craftsmen are there to allow the merchants to unload cheap knockoffs of the
Murano product.

Like the Spartans, the diminishing number of living Italians will remain
resident in their own theme park. They will throw pizza, stage operas, blow
glass, restore paintings, design shoes, and bottle wine for busloads of Asians.
Italy's government may be bankrupt, and its bondholders may be paid at 70 cents
on the euro. The parasites who leech off the Italian state will feel rather
like fleas on a dead dog. In Naples, at least, the entrepreneurs will
accommodate to a new conqueror as so many times in the past, and continue to
enjoy life, until Vesuvius erupts.

Note
1. Hellenistic and Roman Sparta: a tale of two cities, by Paul Cartledge
and Antony Spawforth (Psychology Press, 2002), p. 194 Spengler is channeled by David
P Goldman. Comment on this article in Spengler's Expat Bar forum.